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EUR/USD Drops on Juncker’s Comments

January 16, 2013 (Last updated on January 17, 2013) by

EUR/USD continued to drop today as Eurogroup leader Jean-Claude Juncker said yesterday that the euro’s exchange rate is too high. Ewald Nowotny, the member of the European Central Bank governing council, said today that he is comfortable with the current level of the shared European currency, but his comments did not help the euro. Today’s data from the United States was rather encouraging, except for the Consumer Price Index, which did not grow last month. At least, it did not fall either.

CPI was unchanged in December on a seasonally adjusted basis as was expected following the drop by 0.3% in November. (Event A on the chart.)

Net foreign purchases were at $52.3 billion in November, above the forecast value of $19.8 billion. The October reading was revised from $1.3 billion to -$1.0 billion. (Event B on the chart.)

Industrial production and capacity utilization grew in December. Production increased 0.3%, matching forecasts of 0.2%, after rising 1.0% in November. Utilization rate was at 78.8%, near the November rate of 78.7% and the predicted figure of 78.6%. (Event C on the chart.)

Crude oil inventories decreased by 1.0 million barrels instead of rising by 2.0 billion barrels as was predicted and total motor gasoline inventories increased by 1.9 million barrels last week. (Event D on the chart.)

EUR/USD for 2013-01-16

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